Innovation & Automation in Accounts Payable: Dramatic Shifts are Occurring, Is your Company Innovating Ahead of the Curve or Caught in Neutral?

Transcription

1 Innovation & Automation in Accounts Payable: Dramatic Shifts are Occurring, Is your Company Innovating Ahead of the Curve or Caught in Neutral? 5/31/2016 The Accounts Payable & Procure-To-Pay Conference & Expo is produced by:

2 Siemens Functional Shared Services NAM FSS at a Glance Restricted Siemens AG 2016 All rights reserved. intranet.gss.siemens.com

3 FSS is a large captive Shared Services organization, with a broad portfolio of services AFS Portfolio: Accounts Payable Accounts Receivable Closing & Reporting General Ledger AFS Key statistics: Employs 2,400 FTE 1) 12.5 Mio. accounts payable 7 Mio. accounts receivable BSS Portfolio: Global Marketing Services Customer Management Services Mergers & Acquisition FSS currently employs 6,000 FTEs 1) HRS Portfolio: Recruiting & Staffing Learning & Development HR Admin & Payroll Global Mobility Expense Reimbursement Health Management HRS Key statistics: Employs 2,300 FTE 1) 4.4 Mio. travel & expense claims 330,000 pay checks per month 200,000 pensioners per month SCMS Portfolio: PO Processing & Clearing OneSRM User support Catalogue Management BSS Key statistics: Employs 450 FTE 1) SCMS Key statistics: Employs 650 FTE 1) 406,000 Purchase Orders / year Calculated productivity of 3,265 purchase orders per FTE 1 Based on figures of FY12 (Actuals rounded) Page 3 May 2016 Released

4 Functional Shared Services North America Background Established in 2000 at that time as a separate legal entity U.S. Headquarters in Orlando; offshore team in India Shared Services location decision driven by proximity to Siemens businesses No mandate: service-by-service, business-by-business; selling exercise still going! Dual reporting lines to U.S. functional heads and to global in Germany Transactional billing model expectation for ongoing price reductions Siemens U.S. business very decentralized: 4 strong, independent Sectors Sectors own ERP s sometimes local, sometimes globally; we work in approximately 16 ERP s In-house I.T. team supporting H.R. platforms across North America and other tools (e.g., Workflow Solutions) Page 4 May 2016 Released

5 FSS Organizational Structure Cluster: North America Accounting & Finance Services (AFS) Accounts Payable Intercompany Accounting Sales/Use Tax Property Tax Master Data Maintenance (vendor, customer) Abandoned, Unclaimed Property General Ledger, Closing & Reporting Fixed Assets Accounts Receivable (Cash Apps) Human Resource Services (HRS) Payroll HRIT HR Administration Global Mobility Services Relocation Services Recruiting and Staffing Administration Expense Reimbursement Supply Chain Management Services (SCMS) Indirect Material Procurement SRM Support Import / Export Compliance Combination of on-shore Key Account Management, off-shore (captive) operations, and outsourcing Primarily onshore Service Delivery Model Support Functions Procurement and SRM offshore (captive) operations Import/Export - onshore Finance / IT / HR / Quality / Project Management / Communications / CRM Onshore: 330 Total Headcount Offshore: 250 Page 5 May 2016 Released

6 Moving to World Class will deliver significant benefits for Siemens What is in it for Siemens? We take non-core processes of businesses and make them core to us We increase our customers productivity and generate savings We ensure transparency, quality and compliance in all processes We understand our customers business requirements We help the businesses to fulfill their growth targets Page 6 May 2016 Released

7 Siemens Global Shared Services NAM Electronic Invoicing Journey, Page 7 May 2016 Released

8 Defined Objectives & Goals for Automation: Objective Increase einvoice submission and evouchering can assist Enable SOCs Siemens to reduce Business cost associated Units to with reduce Siemens cost 20% and SG&A improve quality in the cost Accounts reduction Payable initiative process through increased electronic invoice submission and vouchering. Two primary goals: Aggressive rollout to exceed the Siemens 22% G&A cost reduction target in 90% the area Electronic of Accounts Invoicing Payable submission within one year. 95% Electronic Vouchering Primary success Goals rate 80% electronic receipt of invoices 95% e-vouchering / posting rate of an electronic invoice Page 8 May 2016 Released 8

9 Siemens Global Shared Services NAM Vision of Siemens AP: 1.Take the AP function beyond transaction processing into more strategic partnership and value-add activities. 2. Provide significant cost savings to the Siemens operating companies that we support Siemens Business Unit Divisions Invoices Processed 1.4 million per year million per year Global Supplier Base 63,000 over 100,000 Siemens Real Estate, A Division of Siemens Corporation Siemens Financial Services Siemens Industry, Inc.- INC-MVSG Siemens Capital Company FSS North America, A Division of Siemens Corporation Omnetric Corp Siemens Credit Warehouse, Inc. Siemens Corporation, Corporate Technology, A Division of Siemens Corporation Siemens Medical Solutions (P40) Siemens Energy, Inc. SMI Holding LLC Siemens Healthcare Diagnostics (P40) Siemens Generation Services Company Siemens Philanthropic Fund Siemens Medical Solutions (P41) Siemens Fossil Services Inc. Siemens Foundation Siemens Healthcare Diagnostics (DPC/BAYER)(P40) Siemens Power Generation Operating Services Company Siemens Caring Hands Siemens Canada Limited Siemens Power Generation Service Company, Ltd. Siemens Industry, Inc - SBT Siemens Building Technologies (Canada) Siemens Power Generation Service Company, LTD - Mexico Branch Siemens Industry, Inc - SEA Corp Siemens Transformers Siemens Power Generation Service Company, LTD - Puerto Rico Branch Siemens Industry, Inc. - SII Siemens Milltronics Process Instruments Inc. Siemens Energy, Inc (Wind Division) Siemens Electrical, LLC Trench Limited Siemens Demag Delaval Turbomachinery, Inc. Siemens Industry, Inc.- SII-RA-SII-CT, RITS Siemens Healthcare Limited Siemens Energy Inc, Oil and Gas Division Siemens Postal, Parcel & Airport Logistics, LLC Siemens PLM Siemens Corporation Siemens Industry, Inc. - STS Siemens PLM Canada Page 9 May 2016 Released

10 AP Automation Key Performance Indicators FSS (US & CAN) Accounts Payable Invoice volume 1.2M 1.8M 1.8M 2.1M 1.8M 1.7M 1.7M 1.8M Electronic Invoice Submission Electronic end to end Electronic payment Inquiries per Mo 41% 56% 69% 77% 77% 81% 84% 86% 26% 48% 55% 62% 63% 69% 70% 71% 61% 67% 76% 78% 82% 82% 85% 88% NA 31,770 16,447 9,420 8,367 6,922 6,468 6,257 IOL Mo Hits NA 39,796 53,599 74,488 75,858 76,144 70,704 67,075 Page 10 May 2016 Released

11 Electronic invoice submission breakdown Submission method 2015 Invoice Vol % Corporate EDI 22.72% Direct Insite (IOL) EDI 6.17% Paper 16.39% Web Non PO (IOL) 1.97% Web PO Flip (IOL) 52.74% Page 11 May 2016 Released

12 E-invoicing and end to end process automation Page 12 May 2016 Released

13 E-invoicing and end to end process automation Page 13 May 2016 Released

14 E-invoicing and end to end process automation Page 14 May 2016 Released

15 Customer self service inquiry tool Self Service Invoice Inquiry All employees and Vendors have access to IOL to look up the status of any invoice. They simply search for the invoice in IOL: Page 15 May 2016 Released

16 Customer self service inquiry tool If assistance is still required after researching and reviewing an invoice status in IOL, an inquiry can be sent to the customer service support team. Select the invoice (1) and click the Inquiry icon (2) to open a prepopulated form for questions. (3) Complete the form by entering your question in the Please Enter Inquiry Details and then select Submit Inquiry. 2 1 Page 16 May 2016 Released

17 Customer self service inquiry tool 3 (3) Complete the form by entering your question in the Please Enter Inquiry Details and then select Submit Inquiry. Page 17 May 2016 Released

18 Customer self service inquiry tool For Non-invoice inquiries or when the invoice cannot be found in IOL, use the General Inquiry found under the Non-Invoice Inquiry section. The form will be pre-populated with the user s contact details. Required fields are inquiry reason, Siemens Operating Company and the Reason for Inquiry. After completing the required fields, select Submit Inquiry. Page 18 May 2016 Released

19 Automated Survey and results providing feedback for process improvement Automatic Survey A survey is ed to all AP inquiry submitters (both phone and IOL) when each C&O ticket is resolved. The results of the survey are compiled in Survey Monkey and sent monthly to our Customer Service Team where they generate the USI score and analyze the feedback. This feedback provides us valuable data to: Identify areas for process improvements and re-train agents if necessary Educate vendors and employees on the AP process to further reduce inquiries Constructive feedback from customers on how we resolved their inquiry both positive & negative Red Alerts for ratings of 4 and below - we reach out to the customer and determine the root cause for the negative rating and any corrective actions Page 19 May 2016 Released

20 Page 20 May 2016 Released

21 Customer Survey scores Page 21 May 2016 Released

22 Solution Overview No more paper All invoices converted to one standard Suppliers 100, ERPs Workflow Direct Insite Paper Solution Invoices 50 Operating 50 Operating Companies 50 Business Companies Units SAP SAP SAP New PO/PO Change EZ-AP Vendor Invoice Data Store Vendor Self Service Inquiry Validation, Increased evoucher success rate Direct integration Scan for Paper invoices Web Entry, PO Flip & Spreadsheet Invoices Direct Integration Invoices (EDI or XML) Invoice Page 22 May 2016 Released 22

23 Key Strategies for e-invoicing Implementation Aggressively targeted high-volume suppliers Targeted problematic, poor quality paper invoice suppliers Established a Vendor Adoption Committee with representatives from all Business Units and weekly meetings Changed the Bill To Address on the PO to reflect the electronic submission method Established and promoted e-invoicing as the way of doing business with Siemens Provided Procurement groups with standard communication and quick training guides for suppliers Required by contract in Terms and Conditions that all new vendors submit invoices electronically Page 23 May 2016 Released 23

24 Implementation Strategy: Targeted High Volume Suppliers 6% of Suppliers produce 79% of Invoices Page 24 May 2016 Released 24

25 Implementation Strategy: Vendor Adoption Committee Established a Vendor Adoption Committee with representatives from all divisions. Internal Education is as important as external communication Goal of the committee is to set clear objectives, measure results and report to executives Example of Key Drivers tracking chart: Vendor Master Division Division Division Division Key Drivers - einvoicing Requirement SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC Standard Onboarding package for Vendors VM E-form back end automation einvoicing Awareness Campaign (MarCom Insert, RFP, Contract Renewals, update T&Cs) Paper address excluded from Purchase Order 1 einvoicing info included on Purchase Order VAC Team members & Communication of Targets TPA/CSP Strategy - Approved E-invoicing IOL Strategy - Approved - Vendors identified - Target 7/16/10-1 letter sent - Target 7/30/10 - Invoices rejected - Target 8/16/10* Target Met Target Met Target Met Target Met N/A N/A N/A Target Met Target Met Target Met Target Met Target Met E- payment E-invoicing requirement placed for new vendors EFT Campaign (combined with IOL letters) Automate payment runs N/A N/A 25 Vendor Adoption Committee Representative Page 25 May 2016 Released NAME NAME NAME NAME Unrestricted NAME NAME Siemens NAME NAME AG 2016 NAME NAME NAME NAME NAME NAME GSS

26 Lessons Learned Internal Support Procurement support is crucial to adopt and sell e-invoicing Executive Sponsorship is necessary at business units level in Shared Services Encourage e-invoicing mandate or define criteria for e-invoicing process before Go Live with internal departments Supplier On boarding Accurate Contact Information is Key for Recruiting Suppliers Target 3 types: high volume, high $ value & traditional problematic suppliers Training & Support must be available - including on demand Prepare quick guides using screen prints Realize that Behavior Change is hard Make Service FREE to Suppliers Sell tool to suppliers explain benefits Allow different methods of electronic invoice submission Ensure dedicated helpdesk and set expectations on supplier support Self Registration to e-invoicing portal for suppliers is critical Straight Through Touch less Processing Updated PO data must be available in the portal to enable PO Flip E-invoice with bad information is almost as bad as a paper invoice Encourage PO Flip Establish P2P end to end true EDI process if possible Ensure up to date vendor master data to ensure match with vendor Page 26 May 2016 Released 26

27 What s Next? Increase and improve Web AP Inquiry No more s & fewer phone calls All inquiries must be submitted through web portal: External / Supplier Inquiries Internal / Employee Inquiries Global Vendor on Boarding Portal Data input from Supplier Reduction in manual effort Improved data accuracy Quicker PO placement Reduced payment errors Central repository of Supplier data Invoice Submission Up front invoice validation Early Payment Discounts Projects in place to increase supplier ability to take early payment discounts Customer Service AP Inquiries / Year Sept 09 Sept 10 Sept 11 Sept 12 Sept 13 Sept 14 Sept 15 Inquiries by Calls 7,260 4,458 2,312 2,411 1,854 1,338 1,477 Inquiries by s 24,510 10, , IOL Web Inquiries 1,664 6,209 5,102 4,345 4,647 5,296 Total Inquiries 31,770 16,447 9,420 8,556 6,960 6,286 7,270 IOL Website Hits 39,796 53,599 74,488 75,858 76,144 75,199 74,791 Page 27 May 2016 Released 27